Why Do the Five Debates Over Macroeconomic Policy Exist

question 15

Multiple Choice

Why do the five debates over macroeconomic policy exist?

• A) mostly because economists disagree over basic issues such as the importance of saving for economic growth
• B) mostly because there are tradeoffs and people disagree about the best way to deal with them
• C) mostly because economic policies have conflicting effects on various groups of people
• D) mostly because people fail to clearly see the benefits or the costs of most changes

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Definitions:

Quantity Supplied

The aggregate supply of a good or service that manufacturers intend to sell, contingent upon a particular price level within a set period.

Quantity Demanded

The complete volume of a good or service that individuals intend to acquire at a predetermined price within a set period.

Shortage

A situation in which the demand for a good or service exceeds its supply in a market.

Surplus

An excess of income or assets over expenditure or liabilities in a given period, indicating financial health.